Setting aside a good percentage of each week’s income for promotion and keeping ads running is critical for any business. But do you keep track of what’s working and how much it’s costing you ?
There are 2 big ways to waste your money on promotion …
(1) Running ads in front of the wrong people – people who have NO interest in what you provide. eg: doggie treat ads to people without a dog.
(2) Not tracking the results of your ads to see if the $250 you spent got you any business in return.
So, you need to know …
- Where the money’s going and if it’s getting a return.
- How to put your ads in front of the right people – which is a big influence on the first point !
First solution : what’s working ?
To track how much we’re spending on promotion, we use a spreadsheet that looks like this …
A quick glossary …
A very low-cost product or service that converts the prospect into a customer. We use a $7 Local consultation and a $2.85 Kindle book on Amazon.
This is your main product or service.
Something that enhances the value of your main product or service.
What to do …
- Create a spreadsheet ( or download ours ) that has a line for each form of advertising. Type the profit you make on each item in a corner of the spreadsheet.
- Add a column that multiplies the item-values with how many of each you get for the week.
- Every time you get a contact or sell an item, add a 1 in the correct spot.
Probably the easiest way to find out which promotion-source got you the contact is to remember to ask people. Also note-down their names, so that if they buy something later it gets entered for the correct promotion-source.
If sales are on-line, it can be a bit more automated.
We use www.visualwebsiteoptimiser.com which tells you if people make it to the thank-you page after a sale and what traffic-source they came from.
You can also count how many people make it to a thank you page after a sale by using conversion tracking, which is provided by both Google and Facebook.
For a lot of businesses, where people phone in ( as happens a lot from Google’s Local ABC map search-results ) or where sales happen by invoice, you’ve just to ask them.
You can ( and should ) look at the lifetime value of a customer as well. If you have an idea of this, that’s worth adding into the spreadsheet too.
It makes sense to continue promotional actions that are getting you sales and to cut back on those that aren’t ( except for testing ).
Second solution : running ads in front of the right people.
Download a plan that walks you through locating where to run ads by clicking this picture …
And if you’d like help working out an online business plan then click here …